8-K - FKWL - Equibles

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of

the Securities Exchange Act of 1934

Date of Report: October 1, 2021

Franklin Wireless Corp.

(Exact name of registrant as specified in its charter)

Nevada	0-11616	95-3733534
(State or other jurisdiction<br> of incorporation)	(Commission<br>File Number)	(IRS Employer<br>Identification No.)

9707 Waples Street

Suite 150

San Diego, California 92121

(Address of principal executive offices)

Registrant's telephone number, including area code:

(858) 623-0000

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading symbol(s)	Name of each exchange on which registered
Common Stock, par value $.001 per share	FKWL	The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant is an emerging growth company as defined in in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by checkmark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Section 5 - Corporate Governance and Management

Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

(a)	On October 1, 2021, the Board of Directors renewed Franklin’s management agreement with its Chief Executive Officer, OC Kim.<br>The Management Agreement is attached hereto as an exhibit to this filing.
(b)	On October 1, 2021, the Board of Directors renewed Franklin’s Change of Control Agreements with its Chief Executive Officer,<br>OC Kim, and its Chief Operating Officer. David Lee. The Change of Control Agreements are attached as exhibitsto this filing
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Section 9 - Financial Statements and Exhibits

Item 9.01 - Financial Statements and Exhibits.

Exhibit 10.1 Management Agreement, dated October 1, 2021, between Franklin Wireless Corp. and OC Kim

Exhibit 10.2 Change in Control Agreement, dated October 1, 2021, between Franklin Wireless Corp. and OC Kim

Exhibit 10.3 Change in Control Agreement, dated October 1, 2021, between Franklin Wireless Corp. and David Lee

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	FRANKLIN WIRELESS CORP.
Date: October 4,<br> 2021	By: /s/ OC Kim
	OC Kim, President

Exhibit 10.1

Mr. OC Kim

5405 Pinewood Trails

San Diego, CA 92130

September 7, 2021

Dear Mr. Kim,

FRANKLIN WIRELESS CORP., a Nevada corporation (“Franklin”), is pleased to extend your employment contract on the following terms.

You will continue to serve as President of Franklin Wireless and report to the Board of Directors (the “Board”) of Franklin Wireless.

You will continue to be responsible for:

Overall management.
Overall operations.
Sales and marketing.
Spearheading new investment sources and funding opportunities.
Overall company strategy.
Product management.

You will work primarily out of our principal office located San Diego, California

You may be expected to travel as reasonably required by your duties. Franklin will reimburse you for your reasonable and necessary travel, entertainment, business and other expenses incurred in direct consequence of the discharge of your duties. Franklin does not authorize you to incur any such expenses without prior approval.

Of course, Franklin may change your position, duties and work location from time to time, in its sole and absolute discretion.

Salary and Benefits: Your compensation will be $12,500.00 per pay period**,** equivalent to $300,000.00 per year, less payroll deductions and all required withholdings by Franklin. You will be paid semi monthly. Your position is as an exempt employee. This means you are not eligible to be paid overtime compensation. You will be immediately eligible for standard benefits, such as medical and dental insurance, vacation, sick leave and holidays in accordance with Franklin employment policies and any standard Franklin policy as may be adopted by Franklin from time to time.

A $700.00 per month is allowed as a car allowance during your employment with Franklin.

Franklin Board of Directors may modify your compensation and benefitsfrom time to time, in its sole and absolute discretion.

Bonus and Terms of Compensation: The Company will use its reasonable efforts to implement a performance incentive program. You will be eligible to participate in this discretionary, performance-based incentive program. This incentive will be tied to your specific responsibilities and Franklin’s performance and will be determined in the sole and absolute discretion of the Board.

Outside Activities: You are expected to devote your full time professional attention and expertise to the business of Franklin, and to work the hours necessary to fulfill your duties in an efficient manner. Except with the prior written consent of the Board, you will not during your employment with Franklin undertake or engage in any other employment, occupation or business enterprise. This prohibition does not preclude you from holding passive investments. You may engage in civic and not-for-profit activities so long as such activities do not materially interfere with the performance of your employment duties for Franklin.

Proprietary Information and Inventions Agreement: As a Franklin employee, you are expected to abide by Franklin rules and regulations and your previously signed Proprietary Information and Inventions Agreement, and the Company Code of Ethics, which, among other things, prohibits unauthorized use or disclosure of Franklin proprietary information are carried over with the signing of this contract.

At-will Employment: Your employment with Franklin is not promised for any specified period of time. Rather, it is “at-will,” which means that you may terminate your employment with Franklin at any time and for any reason whatsoever simply by notifying Franklin. Likewise, the Franklin Board may terminate your employment at any time and for any reason whatsoever, with or without cause or advance notice. This at-will employment relationship cannot be changed except in writing signed by the Franklin Chairman of the Board.

Arbitration: In the event of any dispute in connection with this Agreement or the Exhibits, the parties agree to resolve the dispute by binding arbitration in San Diego, California, under the Arbitration Rules of the American Arbitration Association ("AAA"), with a single arbitrator familiar with employment and technology agreements appointed by AAA. In the event of any dispute, the prevailing party shall be entitled to its reasonable attorneys' fees and costs from the other party, whether or not the matter is litigated or arbitrated to a final judgment or award. The arbitrator's decision shall be final and binding on all parties, and may be entered in any court having competent jurisdiction.

Integration; Documentation: The employment terms in this letter, together with your Proprietary Information and Inventions Agreement, supersede any other agreements or promises made to you by anyone, whether oral or written. As required by law, your employment is subject to satisfactory proof of your right to work in the United States.

Employee Handbook, Confidentiality Agreement, Code of Conduct, and compliance with the Company’s policies, practices and procedures are terms and conditions of your employment. As a condition of accepting this contact of employment, you will be required to complete, sign, and return the following: Acknowledgement of Receipt of the Handbook, Confidentiality Agreement.

Your tenure as President of Franklin Wireless shall be for a three(3) year period, which covers the period of October 1, 2021, thru September 30, 2024. At the end of that period, both parties may decideon renewing the contract.

Please sign and date this letter, and return it to me by September13, 2021, if you wish to accept employment at Franklin under the terms described above.

We look forward to your favorable reply and to a productive and enjoyable work relationship.

Sincerely,

Gary Nelson

Chairman of the Board of Directors of Franklin Wireless

On behalf of Franklin Wireless Corp.

John F. Parks - Director of Human Resources

You acknowledge that you have carefully read and considered all provisions of this Agreement and the Exhibits and agree that all of the information set forth herein are fair and reasonably required to protect the Company's interests. You acknowledge that you have received a copy of this Agreement and the Exhibits as signed by you.

/s/ OC Kim	10/01/21
OC Kim	Date

Attachments:

Exhibit A

Arbitration

Any amendment to this Agreement shall be effective only if in writing and signed by both Employee and the President of Franklin Wireless Corporation

Governing Law. This Agreement, the rights and obligations of the parties, and any claims or disputes will be governed by the laws of the state of California. Any disputes other than injunctive relief by either party shall be resolved by arbitration before a neutral arbitrator in San Diego County, California, and any claim for injunctive relief shall only be filed in the Superior Court of the County of San Diego, California.

Arbitration. Arbitration is a process in which a dispute is presented to a neutral third party for a final and binding decision. There is no jury. Either party may choose to have a lawyer represent the party or not. The prevailing party can be awarded anything that may have been awarded after going through a long court process.

Franklin Wireless and Employee both give up certain rights, and gain certain benefits by arbitration. Other than for claims for injunctive relief, both parties agree to use arbitration in place of any other type of action, claim or lawsuit, and to submit to final and binding arbitration all claims or disputes that cannot be resolved informally which are related to Employee’s employment or the termination of employment with Franklin Wireless, whether based in tort, contract, or provisions of federal or state labor and employment laws, including, but not limited to, any statutory claims, including those arising under Title VII of the Civil Rights Act of 1964, the Age Discrimination in Employment Act, the Americans with Disabilities Act, and the California Fair Employment and Housing Act, federal or state Family Medical Leave or Rights laws, as well as any claims of wrongful termination, breach of contract, breach of the covenant of good faith and fair dealing, negligent or intentional infliction of emotional distress, negligent or intentional misrepresentation, negligent or intentional interference with contract or prospective economic advantage, defamation, invasion of privacy, discrimination, harassment, disability, and claims related to wages, including minimum wage, overtime, meal periods, vacation, commissions and bonuses.

The parties agree binding arbitration will be the sole remedy for any arbitrable claim, and agree to give up any right to a jury trial. Arbitration will be conducted before a single neutral arbitrator in San Diego County, California. The arbitrator will be chosen jointly by the parties and the arbitration will be conducted under the Federal Arbitration Act, or if inapplicable, the California Arbitration Act, under the Arbitration Rules of the American Arbitration Association ("AAA"), with a single arbitrator familiar with employment and technology agreements appointed by AAA. If the parties cannot agree on an arbitrator, then AAA shall appoint an arbitrator in accordance with AAA rules. The arbitrator shall have only such authority to award damages, costs, and fees as a court would have for the particular claim(s) asserted. The parties agree the arbitrator shall not have authority to hear any claim brought by another person, or any class action, collective action, or representative action to the extent this is not in violation of existing state or federal law. Nothing in this Agreement is intended to affect any right to engage in protected activity under the National Labor Relations Act. This arbitration agreement does not cover Unemployment Insurance or Workers Compensation claims.

Arbitration shall be final and binding upon the parties and shall be the exclusive remedy for all arbitrable claims. Either party may bring an action in court to compel arbitration, to obtain injunctive relief, or to enforce an arbitration award. Otherwise, neither party shall initiate or prosecute any lawsuit or administrative action in any way related to an arbitrable claim.

The arbitrator is expected to handle all aspects of the matter, including discovery and any hearings, in such a way as to minimize the expense and time of the process while assuring a fair and just result. The arbitrator shall control discovery by appropriately setting the amount of discovery that may be conducted, however, at a minimum, each party will be entitled to at least one deposition and shall have access to essential documents and witnesses as determined by the arbitrator. Franklin Wireless will pay the expenses for the arbitrator and AAA, except Employee shall pay a filing fee which shall be no greater than the cost of filing a lawsuit in Superior Court.

The arbitrator shall have exclusive authority to resolve all arbitrable claims, including, but not limited to, whether any particular claim is arbitrable, and whether all or any part of this Agreement is void or unenforceable. If any provision of the Agreement is found unenforceable, that provision may be severed without affecting this Agreement. The arbitrator shall have the power to award any relief permitted by law.

Headings - The paragraph headings contained in this Agreement are inserted for convenience or reference only, will not be deemed to be part of this Agreement for any purpose, and will not in any way define or affect the meaning or scope of any of the provisions.

You acknowledge that you have carefully read and considered all provisions and agree that all of the restrictions set forth herein are fair and reasonably required to protect the Company's interests. You acknowledge that you have received a copy of this Agreement as signed by you.

/s/ OC Kim	10/01/21
OC Kim	Date

Exhibit 10.2

CHANGE OF CONTROL AGREEMENT

This Change of Control Agreement (the “Agreement”) is entered into between Franklin Wireless Corp., a Nevada corporation (the “Company,” which term shall include any successor by merger, consolidation, sale of substantially all of the Company’s assets or otherwise), and OC Kim (“Executive”) effective as of October 1, 2021 (“Effective Date”).

RECITALS

A. It is expected that the Company from time to time will consider the possibility of an acquisition by another company or other change of control, whether voluntary or involuntary. The Board of Directors of the Company (the “Board”) recognizes that such consideration or concern can be a distraction to Executive and can cause Executive to consider alternative employment opportunities. The Board has determined that it is in the best interests of the Company and its stockholders to assure that the Company will have the continued dedication and objectivity of Executive, notwithstanding the possibility, threat or occurrence of a change of control of the Company .

B. The Board believes that it is in the best interests of the Company and its stockholders to provide Executive with an incentive to continue Executive’s employment and to motivate Executive to maximize the value of the Company for the benefit of its stockholders.

C. The Board believes that it is imperative to provide Executive with certain benefits upon a change in control of the Company. These benefits will provide Executive with enhanced financial security and incentive and encouragement to remain with the Company.

NOW, THEREFORE, in consideration of the mutual covenants contained herein, the parties hereto agree as follows:

1. Definition. For purposes of this Agreement, the term “Change of Control” will mean the occurrence of any one or more of the following events:

(i) Any person or company, or affiliated group, becomes the owner of more than fifty percent (50%) of the Company’s Common Stock; or

(ii) If during any 12–month period, individuals who, as of the Effective Date, constitute the Board of Directors of the Company (the “ContinuingDirectors”) cease for any reason to constitute at least a majority of such Board; provided, however, that any individual becoming a director after the Effective Date whose election or nomination for election by the Company’s stockholders, was approved by a vote of at least a majority of the Continuing Directors will be considered as though such individual were a Continuing Director; or

(iii) A reorganization, merger, consolidation or similar transaction that will result in the transfer of ownership of more than fifty percent (50%) of the Company’s outstanding Common Stock or that will result in the issuance of new shares of Company Common Stock in an amount equal to more than fifty percent (50%) of the amount of Common Stock outstanding immediately prior to such issuance; or

(iv) Liquidation or dissolution of the Company or sale of substantially all of the Company’s assets.

2. At–Will Employment. The Company and Executive acknowledge that Executive’s employment is and will continue to be at–will, as defined under applicable law.

3. Severance Payment. Upon a Change of Control, the Company will provide the following benefits to Executive as set forth below:

(i) The Company will pay to Executive, within ten (10) days after the Change of Control, a lump sum cash amount of Five Million Dollars ($5,000,000), by wire transfer to an account designated by Executive; and

(ii) Immediately prior to the Change of Control, one hundred percent (100%) of Executive’s then outstanding and unvested stock options will vest, become immediately exercisable and remain exercisable for the period prescribed in the applicable stock option agreement, without respect to any expiration or termination resulting from the termination of Executive’s employment by the Company..

4. Withholding. All payments required to be made by the Company to Executive under this Agreement will be subject to the withholding of such amounts, if any, relating to tax and other payroll deductions as may be required by law.

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5. Arbitration. Any dispute or controversy between the parties involving the construction or application of any terms, covenants or conditions of this Agreement, or any claim arising out of or relating to this Agreement, or any claim arising out of or relating to Executive’s employment by the Company that is not resolved within ten (10) days by the parties will be settled by arbitration in the City of San Diego, California, in accordance with the rules of the American Arbitration Association then in effect, and judgment upon the award rendered by the arbitrator(s) may be entered in any court having jurisdiction thereof. Any decision of the arbitrator(s) will be final and binding upon the parties.

6. No Duty to Mitigate. Benefits payable under Section 3 of this Agreement will neither be governed by any duty to mitigate damages.

7. Successors. This Agreement will inure to and be binding upon the Company’s successors. The Company will require any successor to all or substantially all of the business and assets of the Company by sale, merger or consolidation (where the Company is not the surviving corporation), lease or otherwise, by agreement in form and substance satisfactory to Executive, to assume this Agreement expressly. This Agreement is not otherwise assignable by the Company or by Executive.

8. Code Section 409A. Notwithstanding anything to the contrary in this Agreement, if the Company reasonably determines, after consultation and agreement with Executive that Section 409A of the Code will result in the imposition of interest and additional tax, Executive shall not be paid any compensation or benefits hereunder upon a separation from service (within the meaning of Section 409A(a)(2)(A)(i) of the Code and the regulations promulgated thereunder) until the date which is six (6) months after the date of such separation from service (or, if earlier, the date of death of Executive). Such severance or other benefits otherwise due to Executive on or within the six (6) month period following Executive’s termination of employment will accrue during such six (6) month period and will become payable in a lump sum payment on the date six (6) months and one (1) day following the date of Executive’s termination. All subsequent payments, if any, will be payable as provided in this Agreement. It is the intent of this Agreement to comply with the requirements of Section 409A of the Code so that none of the severance payments and benefits to be provided hereunder will be subject to the additional tax imposed under Section 409A of the Code, and any ambiguities herein will be interpreted to so comply.

9. Term of Agreement. This Agreement shall remain in effect for three years from the date hereof, at which time it will expire.

10. Amendment or Modification; Waiver. This Agreement may not be amended unless agreed to in writing by Executive and the Company. No waiver by either party of any breach of this Agreement will be deemed a waiver of a subsequent breach.

11. Severability. In the event that any provision of this Agreement is determined to be invalid or unenforceable, the remaining provisions shall remain in full force and effect to the fullest extent permitted by law.

12. Controlling Law. This Agreement will be controlled and interpreted pursuant to California law.

13. Conflict. In the event of a conflict between this Agreement and the provisions of any other compensation or benefit arrangement between the Company and Executive, this Agreement shall prevail.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first set forth above.

By: /s/ OC Kim
OC Kim, President
Franklin Wireless Corp.
By:	/s/ Gary Nelson
	Gary Nelson, Chairman

Exhibit 10.3

CHANGE OF CONTROL AGREEMENT

This Change of Control Agreement (the “Agreement”) is entered into between Franklin Wireless Corp., a Nevada corporation (the “Company,” which term shall include any successor by merger, consolidation, sale of substantially all of the Company’s assets or otherwise), and Yun J. (“David”) Lee (“Executive”) effective as of October 1, 2021 (“Effective Date”).

RECITALS

NOW, THEREFORE, in consideration of the mutual covenants contained herein, the parties hereto agree as follows:

1. Definition. For purposes of this Agreement, the term “Change of Control” will mean the occurrence of any one or more of the following events:

(i) Any person or company, or affiliated group, becomes the owner of more than fifty percent (50%) of the Company’s Common Stock; or

(iv) Liquidation or dissolution of the Company or sale of substantially all of the Company’s assets.

2. At–Will Employment. The Company and Executive acknowledge that Executive’s employment is and will continue to be at–will, as defined under applicable law.

3. Severance Payment. Upon a Change of Control, the Company will provide the following benefits to Executive as set forth below:

(i) The Company will pay to Executive, within ten (10) days after the Change of Control, a lump sum cash amount of Two Million Dollars ($2,000,000), by wire transfer to an account designated by Executive; and

6. No Duty to Mitigate. Benefits payable under Section 3 of this Agreement will neither be governed by any duty to mitigate damages.

9. Term of Agreement. This Agreement shall remain in effect for three years from the date hereof, at which time it will expire.

12. Controlling Law. This Agreement will be controlled and interpreted pursuant to California law.

13. Conflict. In the event of a conflict between this Agreement and the provisions of any other compensation or benefit arrangement between the Company and Executive, this Agreement shall prevail.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first set forth above.

By: /s/ David Lee
Yun J. (“David”) Lee
Franklin Wireless Corp.
By:	/s/ Gary Nelson
	Gary Nelson, Chairman